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Part X-Men, part Harry Potter, Pioneer is an online tournament for ambitious outsiders everywhere.
The problem of inequality is really two problems. First, there's the
lopsided distribution of wealth: Whether you look at income or assets,
the rich, at least in America, are comparatively richer than they've
been in decades while the middle and working classes are losing ground.

Then there's inequality of opportunity. Access to the engines of wealth
creation is itself distributed unequally, producing socioeconomic
mobility that's lower in the U.S. than in other developed nations, and
getting worse.

There's no more powerful engine of wealth creation than the technology
industry, but its record of widening the circle of opportunity is mixed
at best. The people who get venture capital funding for their startups
or high-paying engineering jobs tend to be disproportionately male,
white (or Asian) graduates of elite universities.

If you're living paycheck to paycheck, you're unlikely to quit your job
to start a company, even if it's a billion-dollar idea. To quote from a
recent paper by Lynnise E. Pantin, director of Boston College Law
School's Entrepreneurship and Innovation Clinic, "Entrepreneurship is a
compelling solution to wealth inequality, but wealth inequality can be
an impediment to success in entrepreneurship."

Maybe the problem is that, when it comes to identifying entrepreneurial
talent, Silicon Valley doesn't act like Silicon Valley at all. It relies
on old-boy networks, coffee meetings, demo days. "In reality, the
venture market pretty much operates like a business from the 18th
century," says Daniel Gross, a veteran of Apple and Y Combinator. "No
one has really tried to bring the scale of the internet to this problem
of finding extraordinarily productive, ambitious outsiders and
supporting them."

That's exactly what Gross is seeking to do with his new company, Pioneer.

Each month, it runs a massive online tournament for people pursuing all
sorts of projects--startups, nonprofits, scientific investigations,
novels, whatever. Participants vote on each other's projects, awarding
credit for status updates that reflect evidence of progress. At the end
of the month, a panel of all-star subject-matter experts review the
highest scoring projects and pick anywhere from a handful to a dozen or
so winners. Judges include venture capitalist Marc Andreessen, Stripe
co-founder Patrick Collison, mathematician Stephen Wolfram, and
economist Tyler Cowen.

The second cohort of "Pioneers," announced last week, included a
24-year-old from Ghana who is building a Thumbtack-like booking platform
for vetted local service vendors; a pair of 22-year-olds from India
working on a digital driving assistant; and a 23-year-old Malaysian
journalist who writes about the early lives of geniuses. Gross calls the
winners "a collection of X-Men--these weird, powerful people who don't
really fit in where they are." (He's fond of talking about Pioneer in
pop culture terms. He also name-checks the wizard tournament in Harry
Potter and says his biggest influence might be Ender's Game, the sci-fi
novel about teenagers who train to fight aliens via a video game.)

Each winner gets $1,000 plus a plane ticket to San Francisco, where
they'll have the chance to meet each other and network with mentors.
Those who are starting companies will also be eligible for an investment
from Pioneer, which is backed by Stripe and Andreessen.

At first blush, Gross looks more like the stereotypical face of Silicon
Valley than someone trying to change it. He grew up in Israel, a country
that consistently produces more than its share of successful startups,
put his mandatory military service on hold after he got accepted into Y
Combinator, and sold the resulting startup, Cue, to Apple in 2013 for a
reported $40 million-plus.

But Gross didn't hail from Israel's entrepreneurial class. He grew up in
an ultra-religious community just outside Jerusalem's Old City.
Although his father was a computer science professor, his parents
refused to allow the internet in the house. Had he not been accepted in Y
Combinator, Gross thinks there's a decent chance "I'd still be stuck in
Israel. Maybe an Orthodox Jew--married, with 12 kids."

That sense of random fortune is something he has encountered over and
over in Silicon Valley, and it strikes him as curious in an industry
that thinks of itself as both a meritocracy and a crucible for scalable,
repeatable solutions. "I don't think we need to leave things up to
chance," he says. "We used to, in an era before the internet, but now we
can reach billions of people. Now we can remove luck from the equation
and make it so if you have the talent and ambition, you can succeed."

Those Pioneers who start companies will also, through their success, pay
it forward. Under the terms of the contest, accepting the award money
requires granting Pioneer the right to invest up to $100,000 alongside
other investors in any funding event, with Pioneer's investment capped
at 20 percent of the round. Scaling opportunity in a global way, says
Gross, requires "a lot of money moving through the system, and the way
we do that is by capturing some of the value we create." (Y Combinator
also takes a stake in companies that pass through its accelerator
program.)

"If this system works, it stands to fix a massive problem in society,
which is this Pareto distribution of wealth and income," Gross says. "If
we have a systematic way of identifying promising young talent early on
in life and we can give them money to support their goals, we've
basically managed to fix this massive problem we have today. Which is,
increasingly, the wealth is accumulating to the 1 percent of the 1
percent." Fixing one of the world's biggest problems with a video
game--now that would be magic worthy of Harry Potter.